The Singapore Monetary Authority (MAS) recently inaugurated the ESG Impact Hub (the Hub) to encourage co-location and collaboration among Environment, Social, and Governance (ESG) FinTech start-ups and solution providers, financial institutions, and real economy stakeholders. The Hub, inaugurated by the Managing Director of MAS, Ravi Menon, will also serve as a focal point for industry-driven sustainability initiatives like the Point Carbon Zero Programme.
“The establishment of the ESG Impact Hub is a critical milestone in Project Greenprint’s journey to build a vibrant and robust ESG ecosystem in Singapore, underpinned by technology and data,” says Dr Darian McBain, Chief Sustainability Officer, MAS.
She also said that the physical Hub will add to MAS’ plans to launch a digital Greenprint Marketplace next year to help the online ESG community in the region grow. It will also be the starting point for public-private partnerships that help Asia make a fair and sustainable transition to a low-carbon economy. The Hub is meant to take advantage of the strong industry interest in Project Greenprint and help Singapore’s ESG ecosystem grow faster on three fronts:
The first is for the Growing ESG FinTechs. The Hub will promote the discovery, scaling, and deployment of technological solutions to address the ESG demands of corporations and financial institutions, particularly in terms of reliable climate and sustainability data monitoring, reporting, and verification.
The second is for Anchoring ESG Enablers. Through the Hub, MAS will work with knowledge partners, financial institutions, and investors to organise critical ESG initiatives such as ESG FinTech accelerator programmes, training and capacity-building seminars and thought leadership events.
And third is for Supporting ESG Stakeholders. MAS will work with the Hub community to deploy its programmes and solutions that will have measurable impacts on sectoral transition efforts, with a focus on the eight target sectors designated by the Green Finance Industry Taskforce (GFIT).
On the other hand, at the Hub’s launch, there were already 15 ESG FinTechs and organisations set up. MAS will keep working with key stakeholders to build the Hub’s on-site community and make it easier for the financial sector to get access to high-quality climate and sustainability data. This will help green and sustainable projects use capital more efficiently.
Moreover, to aid them with their strategies and actions to create a reliable and active sustainable finance ecosystem, MAS has announced the creation of a Sustainable Finance Advisory Panel (SFAP).
Reflecting the multifaceted nature of the sustainability agenda, the SFAP is made up of a varied collection of top sustainability professionals from financial institutions, academia, and other stakeholders from around the world.
The problems surrounding transition finance and the roles of financial institutions, corporations, regulators, and governments in facilitating an orderly and inclusive transition in the area were the main topics of discussion at the first SFAP meeting with the MAS management.
The following are some of the key issues raised about financial institutions: a) Ensuring an equitable transition to net zero, for example, by taking into account the impact of climate finance decisions on jobs and livelihoods, b) Financial institutions setting interim targets and referencing sectoral routes to enable credible and transparent transition strategies, c) creating FinTech solutions for ESG data and identifying incentive mechanisms to encourage data exchange, and d) increasing the amount of blended funding available for projects that are not as economically appealing or have a high-risk profile.
The discussion will aid in honing MAS’s sustainable finance plans and efforts. The next SFAP meeting is scheduled for 2023.
